What is the unit variable manufacturing cost

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Question: Units Sold to Break Even, Unit Variable Cost, Unit Manufacturing Cost, Units to Earn Target Income Werner Company produces and sells disposable foil baking pans to retailers for $2.75 per pan. The variable cost per pan is as follows:

Direct materials                     $0.37

Direct labor                            0.63

Variable factory overhead         0.53

Variable selling expenses           0.12

Fixed manufacturing cost totals $111,425 per year. Administrative cost (all fixed) totals $48,350.

Required: 1. Compute the number of pans that must be sold for Werner to break even.

2. Conceptual Connection: What is the unit variable cost? What is the unit variable manufacturing cost? Which is used in cost-volume-profit analysis and why?

3. How many pans must be sold for Werner to earn operating income of $13,530?

4. How much sales revenue must Werner have to earn operating income of $13,530?

Reference no: EM131673669

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